Around a fourth of British individuals failed a financial comprehension assessment
In a recent survey conducted by Shepherds Friendly, the financial literacy of Brits was put to the test. The study quizzed 2,000 consumers across the UK on ISAs, investing, and personal finance.
The results paint a mixed picture of financial understanding among the population. While some cities showed impressive financial literacy, others struggled.
London emerged as the city with the highest financial literacy compared to other cities in England. However, Glasgow was found to be the least financially literate city, with just 16% of respondents getting the quiz questions correct. Southampton took the top spot as the most financially literate city in the UK, with 38% answering the questions correctly. Southampton was followed by Cardiff in second place and Liverpool in third.
The cost of living crisis has made understanding personal finances more important than ever. Yet, more than a quarter of Brits keep their savings in a current account where they fail to make interest. Just one in three Brits are putting their savings into an ISA account, while over two-fifths of Brits are putting their savings into other types of savings accounts.
The survey also revealed some interesting trends in the way Brits gather information on personal finance topics. Banks remain the most common source, but TV shows, such as The Martin Lewis Money Show, are the second most popular way for Brits to gather information. Interestingly, Gen-Zs are mostly sourcing information on personal finance topics from TikTok.
The findings also highlighted a gender divide in financial literacy. Men in the UK are more financially literate than women, with 31% getting half or more of the questions correct compared to 24% of women. The most common way those aged 55 and over are sourcing their information on money related topics is through TV shows. On the other hand, those aged 18-24 are the least likely to save in an ISA and are mostly sourcing information on personal finance topics from their banks.
Derence Lee, Chief Finance Officer at Shepherds Friendly, emphasizes the importance of understanding personal finances and utilizing methods to help grow and protect savings. Shepherds Friendly offers a range of ISAs to help individuals better understand and grow their personal savings based on their saving goals.
In conclusion, while there is room for improvement in financial literacy across the UK, it is encouraging to see that many Brits are taking steps to educate themselves on personal finance topics. Whether through banks, TV shows, or social media, it is essential to stay informed and make informed decisions about our money.
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